December 14, 2022

Expert predictions for the year ahead from Ramp spend data

Jump to sections
Spending made smarter
Easy-to-use cards, spend limits, approval flows, vendor payments —plus an average savings of 3.5%.
Get fresh finance insights, monthly
Time and money-saving tips,
straight to your inbox
Thanks for signing up
Oops! Something went wrong while submitting the form.

Many businesses have gone through the ringer this year. From inflation to an unpredictable stock market, 2022 has been a whirlwind for companies of all sizes. As the year comes to an end, here are the biggest shifts that we’ve seen businesses make in their spend and what top finance leaders are predicting for next year. From ad spend taking a wallop to software going strong, we’re taking a deep dive into how companies large and small have performed, featuring Joe Garafalo of Mosaic, Joanna Coleman of Burkland Bookkeeping & Accounting Practice, Artem Mashkov of SwagUp, and Scott Orn of Kruze Consulting.

1. Larger businesses severely curtailing ad spend 

Percentage of ad spend volume is down significantly since the beginning of the year, showing how businesses are pulling back on account of current macro trends and potentially that they’re not realizing as much closed won from ad spend. 

However, while total volume is down, there are marked differences when sliced by business segment across the 30-day moving average YTD. Mid-market (-48.4%) and enterprise (-50.9%) businesses are pulling back significantly while small  (+14.5% ) and large SMBs (+21.5% ) have experienced slight upticks. 

These smaller businesses may be in stealth or growth mode, and still see value in ad spend to help ensure growth at a reasonable, sustainable rate. 

With the market downturn we’re all experiencing, it makes sense that businesses are pulling ads as a way to cut costs — especially since it’s easy to turn back on when the market turns back around. At Mosaic, we did a deep dive into the ROI of our ad spend to figure out how we could cut costs without significantly impacting growth. What we found was that while LinkedIn ads help us with brand awareness and might help mid-funnel prospects move quicker, the direct ROI was about four times lower than our Google Ads channel. We’re turning our LinkedIn ad spending down and putting more focus on PPC because the cost per click on LinkedIn is so high for the current market conditions.”-Joe Garafalo, Co-Founder and COO, Mosaic

2. Companies spending on T&E to combat WFH fatigue  

T&E has experienced steady spend volume growth. 

Businesses across every segment are increasing their spend allocation, as companies battle WFH fatigue and seek to keep employees happy despite market volatility. Whether spending on T&E for internal employees or for C-suite executives flying out to meet clientele, T&E has remained a spend priority. 

“The data on T&E spend is similar to what we’re seeing with our clients, who are allocating more funds to T&E for internal travel and team building. We don't see this trend stopping anytime soon." -Joanna Coleman, Managing Director, Burkland Bookkeeping & Accounting Practice

It’s worth noting that travel is now significantly more expensive than it was even a year ago, causing total spend to increase. For example, air fares are up 43% YoY. 

Small SMBs are leading the way (+119.5%), with large SMBs (+118.7%) and enterprise not far behind (+113.4%). Mid-market still posted a substantial increase, but lagged slightly in comparison (+91.4%). 

3. Small SMBs, large SMBs surprisingly lead charge in software spend 

Companies are still finding value in SaaS to help themselves scale amid a chaotic economy.

“Core and critical SaaS should be safe but anything redundant or ‘nice to have’ will be scrutinized. A lot of SaaS is just a Google or Microsoft feature wrapped in a nicer experience—those will be the first to go." -Artem Mashkov, CFO, SwagUp

Small and large SMBs posted substantial gains in software spend (+61.2% and +76.3%, respectively) compared to mid-market (+4.3%) and enterprise (+1.95%) companies. These smaller segments often have SaaS stacks that are a work in progress. They’re working to identify which software is the best fit for their business, and as a result have high spend as they onboard and offboard different programs. 

“Ramp’s year-end data on software spend mirrors what we’re seeing with our high-growth startup clients, who are increasing their software spend to help unlock growth opportunities amid a competitive landscape and volatile market conditions. We expect this trend to continue well into next year and beyond.”- Scott Orn, COO, Kruze Consulting.

On the other hand, larger businesses often have more stable spend, as they tend to stick with software for a longer period of time and are less prone to switching as 1) they already have a sense of what’s working for them and 2) it can be more cost and time-intensive for these bigger companies to switch. 

Ramp has never been more committed to helping companies save their most valuable resources: time and money. We’ll continue following spend trends and report them out in our next benchmark report. In the meantime, check out our most recent report here

*Small SMB 0-25 employees, Large SMB 26-75 employees, Mid-market 76-499 employees, Enterprise > 500 employees

Sr. Content Marketing Manager, Ramp

Stefanie Gordon is a Senior Content Marketing Manager at Ramp. A former financial journalist and content strategist, she is excited to help Ramp develop new, engaging content.

FAQs

How Crossbeam saved $10K+ with Ramp Price Intelligence

“Right now, I text a group of colleagues and search online—but being able to know within a 5% variance that we are solid on pricing? That gives me peace of mind."
Matt Dougherty, Senior Director of Finance, Crossbeam

How Clearbit closed the books >60% faster with Ramp + NetSuite

“Before Ramp, our month-end close took approximately 10 days. Now it takes three to four days—it's unbelievable.”
Kay Coolican, Accounting Manager, Clearbit

How Ramp helped Webflow lay a foundation for sustained growth

“This product allows us to enable our employees to be full-time right away, Ramp allows us to onboard people quicker, it allows us to get them the tools they need, which in many cases they need to be able to spend in order to grow.”
Ivan Makarov

How Candid expanded internationally with Ramp

“Ramp found over $250,000 in savings right out of the gate. That is far more valuable than any points program.”
Nick Greenfield, CEO, Candid

How FirstBlood’s switch to Ramp sped up their monthly close

“If I code one transaction with a certain vendor, Ramp knows. It makes suggestions based on past transactions. It just works.”
Kyle Potter, CFO, FirstBlood

How Elementus overhauled its spend management with Ramp

“The fact that I can have an expense, match it with a receipt immediately, upload it, and then integrate it into QuickBooks is a godsend.”
Matt Austin, Vice President of Operations, Elementus

How Eight Sleep consolidated their finance stack and launched a new product with Ramp

“Identifying the invoice, finding it in Ramp Bill Pay, and flexing it from there, takes all of one minute…it’s only a few clicks and you’re done.”
Irish Rose, Controller, Eight Sleep